The financial performance of 807 non-Government non-financial large public limited companies

(each with a paid-up capital of Rs.1 crore and above) during 1997-98 is assessed in this article based on their audited annual accounts closed during April 1997 to March 1998 ^#. The companies selected for this study accounted for 21.1 per cent of all non-Government non-financial public limited companies in terms of their paid-up capital as at the end of March 1998.^@@

OVERVIEW

The consolidated results of the financial performance of 807 selected large public limited

companies reveal a general deceleration in the performance in the year 1997-98. The growth in sales and value of production fell substantially over the year, while gross profits, the pre-tax and post-tax profits recorded negative growths for the second year in succession.

The sales of the selected companies rose by 5.5 per cent to Rs.1,75,200 crore in 1997-98

as against a rise of 11.1 per cent observed in the preceding year. Value of production also recorded a growth of 5.5 per cent in the year under review (9.9 per cent in 1996-97). Expenses incurred towards manufacturing increased by 5.0 per cent in 1997-98, as against a rise of 13.0 per cent in 1996-97. Gross profits further decreased by 3.8 per cent in 1997-98, after a fall of 1.4 per cent in the preceding year. Outgo by way of interest payments rose by 11.8 percent while tax provisions was lower by 9.8 per cent in 1997-98. Pre-tax and post tax profits dropped by 11.6 and 12.2 per cent respectively. Retained profits plummeted by 16.9 per cent in 1997-98 over and above a fall of 29.5 per cent witnessed in the preceding year. The gross savings of the selected companies (sum of retained profits and depreciation) dipped by 0.8 per cent in 1997-98 after a fall of 9.2 per cent in the preceding year.

The profitability ratios reflected the downtrend in the corporate sector as outlined above.

Profit margin on sales went down by 1.2 percentage points from 13.8 per cent in 1996-97 to 12.6 per cent in 1997-98, the return on equity (post-tax profits as percentage of net worth) declined further from 10.8 per cent in 1996-97 to 8.5 per cent in 1997-98. The effective tax rate (ratio of tax provision to pre-tax profits) rose by 0.6 percentage points to 26.6 per cent in the year under review. The ordinary dividend rate was lower at 22.0 per cent in 1997-98 as compared to 24.5 per cent in the preceding year.

*

Prepared in the Company Finances Division of the Department of Statistical Analysis and Computer Services.

#

Reference may be made to the September, 1998 issue of the Reserve Bank of India Bulletin for the previous study.

@@

Based on data as on 31st March, 1998 supplied by the Department of Company Affairs, Government of India.

The value of the total net assets (adjusted for revaluation) of the selected companies appreciated

by 11.1 per cent in 1997-98 as compared with 16.2 per cent in 1996-97. The growth of inventories was at a lower rate of 4.4 per cent in 1997-98 as compared with 7.1 per cent in the preceding year.

External funds continued to play a significant role in financing the asset formation, accounting for

62.8 per cent of the total asset formed in 1997-98 as against 65.1 per cent in the preceding year. There was a marginal increase in the share of borrowings in total funds from 43.3 per cent in 1996-97 to 44.6 per cent in 1997-98. Gross capital formation as percentage of total usage of funds increased to 80.9 per cent during 1997-98 (68.3 per cent in the preceding year).

The debt-equity ratio increased from 59.3 per cent in 1996-97 to 60.0 per cent in 1997-98. The

current ratio ( ratio of current assets to current liabilities ) declined to 1.2 in 1997-98 (1.3 in 1996-97). Resources raised from capital markets was of a lower order at 8.0 per cent of the total asset formation during the year under review, as compared to 9.6 per cent in 1996-97.

The total foreign exchange earnings of the selected companies showed an increase of 4.7 per cent

in 1997-98 over and above the growth of 20.1 per cent observed in the preceding year. Total foreign exchange expenditure recorded a lower growth of 0.7 per cent in 1997-98 as against a growth of 11.7 per cent in 1996-97. The share of exports in sales worked out to 8.6 per cent in 1997-98.

INCOME AND EXPENDITURE

The total sales of the 807 selected companies amounting to Rs.1,75,200 crore registered a growth

of 5.5 per cent in 1997-98. The value of production also increased by 5.5 per cent to Rs.1,76,774 crore. 'Other income' of the selected companies grew by 10.6 per cent over the year and stood at Rs.6,447 crore. In comparison, the performance was better in 1996-97, the corresponding growth rates being 11.1 per cent, 9.9 per cent and 11.3 per cent respectively.

On the expenditure side, expenditure on manufacturing increased by 5.0 per cent during the year

under review as against 13.0 per cent in the previous year. Employees' remuneration at Rs.15,306 crore increased by 11.5 per cent in 1997-98 as against 12.7 per cent in the previous year. Provision for depreciation rose by 15.2 per cent in 1997-98 as compared with a much larger rise of 27.6 per cent in 1996-97. Similarly, interest costs went up by 11.8 per cent to Rs.10,861 crore in 1997-98 as compared to an increase of 24.1 per cent in the previous year. Profit growth was negative. Pre-tax profits fell by 11.6 per cent, while post-tax profits of the selected companies plunged by 12.2 per cent over and above a drop of 14.2 per cent and 21.1 per cent respectively in the previous year. Tax provision fell by 9.8 per cent in 1997-98 in contrast to an increase of 14.3 per cent in 1996-97. The effective tax rate worked out to 26.6 per cent in 1997-98.

The slack in the growth of gross profits was also reflected in the gross profit margin which shrunk

from 13.8 per cent in 1996-97 to 12.6 per cent in 1997-98. There was a substantial reduction in the size of the profits ploughed back into business which fell by 16.9 per cent. Dividend payments at Rs.3,436 crore, dipped by 3.3 per cent in 1997-98 against an increase of 2.5 per cent in 1996-97. The ordinary dividend rate worked out to 22.0 per cent in 1997-98 compared with 24.5 per cent in the preceding year. Profit retention ratio was at 62.4 per cent in 1997-98 (65.9 per cent in 1996-97).

EARNINGS AND EXPENDITURE IN FOREIGN CURRENCIES

The year under review witnessed very little real improvement of activity with regard to earnings

and expenditure in foreign currencies. The increase in total earnings in foreign currencies of the selected companies was lower at 4.7 per cent in 1997-98, as against 20.1 per cent in 1996-97 (Table 6). The growth rate in merchandise exports was 6.3 per cent (Rs.15,081 crore) in 1997-98 as compared to 11.1 per cent in 1996-97. Merchandise imports also fell by 0.7 per cent in 1997-98 as against an increase of 11.8 per cent in 1996-97. While imports of raw materials grew by 6.5 per cent capital goods imports fell by 29.4 per cent in 1997-98 as compared to an increase of 1.4 per cent and 46.7 per cent respectively in the previous year. The imports in these two categories accounted for 60.4 per cent and 21.6 per cent respectively of the total merchandise imports in 1997-98. The increase in total expenditure in foreign currencies in 1997-98 was at 0.7 per cent as against 11.7 per cent in 1996-97. The net outflow in foreign currencies recorded Rs.9,175 crore in 1997-98 as against Rs.9,837 crore in the preceding year.

PATTERN OF ASSETS AND LIABILITIES

Total net assets of the selected companies increased by 12.3 per cent to Rs.2,60,326 crore in

1997-98 from Rs.2,31,837 crore (16.3 per cent) in 1996-97 (Table 4). After adjustment for revaluation, the growth in total net assets worked out to 16.2 per cent and 11.1 per cent respectively for 1996-97 and 1997-98 (Table 1). Gross fixed assets and inventories (adjusted for revaluation) grew by 16.4 per cent and 4.4 per cent respectively in 1997-98.

PATTERN OF LIABILITIES AND ASSETS IN 1997-98

The composition of assets and liabilities as at the end of March 1998, remained broadly the same

as in the previous year. The share of net fixed assets in total assets increased from 47.2 per cent in 1996-97 to 50.0 per cent, whereas that of inventories declined from 14.5 per cent in 1996-97 to 13.5 per cent. The share of investments moved up fractionally from 8.8 per cent in 1996-97 to 8.9 per cent in 1997-98. The share of quoted investments in total investments decreased from 27.4 per cent in 1996-97 to 17.6 per cent in the year under review.

Among the liabilities, reserves and surplus accounted for 34.8 per cent of total liabilities (35.2 per

cent in the previous year) while the proportion of borrowings went up by 1.4 percentage points to 39.6 per cent in 1997-98. Borrowings together with reserves and surplus accounted for about 74.4 per cent of the total liabilities in 1997-98. There was an increase in debt-equity ratio from 59.3 per cent in 1996-97 to 60.0 per cent in 1997-98. The current ratio (ratio of current assets to current liabilities) declined from 1.3 in 1996-97 to 1.2 in the year 1997-98.

SOURCES AND USES OF FUNDS

The total funds raised by selected companies was of the order of Rs.32,725 crore in 1997-98

as against Rs.38,537 crore in the previous year. The role of external funds in financing the asset formation continued to be substantial and accounted for 62.8 per cent of the total funds (Table 5).

Borrowings accounted for a greater share in the external funds, increasing from 66.4 per cent in

1996-97 to 71.1 per cent in 1997-98. The share of debentures in total borrowings increased from 9.7 per cent in 1996-97 to 26.8 per cent in 1997-98. The share of bank borrowing in total borrowings declined from 25.2 per cent in 1996-97 to 18.5 per cent in 1997-98. Of the funds raised from the capital market during 1997-98 amounting to Rs.2,628 crore, as much as 64.2 per cent was by way of premium on shares and the balance was net issues. In fact, premium on shares alone accounted for 5.2 per cent of total funds as compared to 7.3 per cent in the preceding year. Internal sources of funds were depleted to the extent of Rs.1,283 crore and stood at Rs.12,174 crore in 1997-98 mainly on account of a 31.3 per cent decline (Rs.2,060 crore) in reserves and surplus. Depreciation provision which formed the major component of internal resources of finance increased to Rs.7,020 crore in 1997-98 from Rs.6,187 crore. Its share in internal funds increased to 57.7 per cent in 1997-98 from 46.0 per cent in 1996-97.

The total assets formation of the selected 807 companies was of the order of Rs.32,725, crore in

1997-98 which was lower by Rs.5,812 crore (15.2 per cent) compared to the level of Rs.38,537 crore observed in 1996-97 (Table-5). Gross capital formation amounting to Rs.26,466 crore accounted for 80.9 per cent of total assets formation in 1997-98. Inventory build-up was of the order of Rs.1,483 crore as against Rs.2,211 crore in 1996-97. Its share in total assets formation reduced to 4.5 per cent in 1997-98 from the earlier year's level of 5.7 per cent.

Performance of Companies by Size of Sales

It is observed that companies with large sales base, generally recorded better rate of growth in

sales during the year under study (Table 7). The growth in sales ascended from negative (-16.9 per cent) for the class of companies with sales of 'Less than Rs.25 crore' to 8.1 per cent for companies with sales of 'Rs.1000 crore and above'. In the case of gross profits also, for companies with sales upto 'Rs 500 crore', the growth rates though negative progressively turned more favourable till it registered a positive growth for companies with sales range of 'Rs 500 - Rs 1000 crore' at 3.7 per cent. For the top sales range companies, however, the profits had more or less remained stable (0.2 per cent). Retained profits depict a somewhat similar picture, till the sales size attains the Rs.500crore - Rs 1000 crore range. The companies have not been able to sustain the levels of retained profits at the previous years' levels.

It would appear that sales size has a bearing on profit margins. The profit margin on sales was the

lowest at 4.7 per cent for the class of companies with sales of 'Less than Rs.25 crore' and peaked at 14.8 per cent for companies with sales of 'Rs.1000 crore and above' (Table 8). While for companies with sales of 'Rs.1000 crore and above' exports formed 7.1 per cent of their sales in 1997-98, for companies in the lower size classes of sales, the share was in the range of 7 to 13 per cent. Inventory-sales ratio was 37.8 per cent in companies with sales of 'Less than Rs.25 crore' group but was much lower at 16.3 per cent for the companies with sales of 'Rs.1000 crore and above' in 1997-98. The debt-equity ratio of the companies with sales of 'Rs.25 crore -Rs.50 crore' was the highest at 81.3 per cent and was 54.9 per cent for companies with sales of 'Rs.1000 crore and above'. Tax incidence was the highest at 82.3 per cent for the companies with sales 'Rs.50 - Rs.100 crore', whereas for companies in the other size classes, except the smallest sales class, it fluctuated between 21 per cent and 49 per cent.

INDUSTRY-WISE PERFORMANCE

Performance of the selected large public limited companies as reflected by their growth in sales,

profits and exports and selected financial ratios in selected industries/ industry groups are given in the following statements (also refer to Tables 10 and 11).

It may be observed that the industries like Silk and Rayon (41 per cent), Basic Industrial Chemicals

(25.6 per cent), Tea (25.5 per cent), Chemical fertilizers (12.9 percent), and Sugar (15.4 per cent) recorded much better growth in their sales during 1997-98. Turning to gross profits, significant improvement over the year was registered by Sugar (77.6 per cent) and Tea (72.5 per cent) industries. On the other hand, gross profits of Engineering (-20.7 per cent), Motor Vehicle (-23.4 per cent) and Electrical machinery (-32.2 per cent) Rubber and Rubber products (-62.2 per cent) and Paper and Paper products (-35.8 per cent) declined sharply in 1997-98. Companies belonging to Tea (148.3 per cent) posted substantial increase in their post tax profits during 1997-98.

The profit margin on sales was high for Shipping (25.1 per cent), Tea (20.9 per cent), Electricity

generation and Supply (18.6 per cent) and Chemical Fertilizer (18.6 per cent) in 1997-98. Effective tax rate worked out to be more than 60.0 per cent in the case of Paper and paper products, Cotton/blended textiles, Ferrous and non-ferrous metal products and Electrical Machinery .

INDUSTRY-WISE PERFORMANCE

A.

Growth Rates of the Selected Items

(Per cent)

Sales

Gross

Profits before

Profits after

Exports

Profits

Tax

Tax

Selected Industry / Industry Groups

1996-97

1997-98

1996-97

1997-98

1996-97

1997-98

1996-97

1997-98

1996-97

1997-98

1

2

3

4

5

6

7

8

9

10

11

Tea (11)

16.6

25.5

27.3

72.5

20.7

126.6

21.0

148.3

55.5

26.9

Sugar (18)

5.7

15.4

- 0.6

77.6

- 89.3

729.3

- 99.1

* *

38.8

- 36.7

Cotton / blended Textiles (63)

0.4

1.7

- 15.5

- 12.3

- 55.9

- 38.4

- 68.6

- 66.8

23.0

- 5.6

Silk and rayon Textiles (26)

12.4

41.0

- 7.7

48.9

- 20.4

21.9

- 24.4

15.6

30.3

42.2

Engineering (265)

15.1

- 4.0

11.5

- 20.7

3.0

- 30.2

- 2.5

- 31.0

3.9

7.0

of which

Motor vehicles (44)

21.2

- 9.5

21.1

- 23.4

15.7

- 29.3

15.8

- 27.2

3.3

2.2

Electrical machinery (77)

7.5

0.7

2.8

- 32.2

- 24.7

- 54.0

- 33.1

- 67.7

15.7

19.5

Machinery other than transport &

electrical (66)

16.6

- 0.9

24.7

-8.9

23.3

- 2.3

19.9

3.1

18.6

- 8.6

Foundries and engineering workshop (41)

5.1

2.8

- 34.3

- 12.1

- 69.0

**

- 76.6

* *

- 20.7

8.1

Ferrous/Non-ferrous metal products (31)

11.4

0.3

8.9

- 26.6

- 18.9

- 79.1

- 32.4

- 93.2

21.6

43.1

Chemical and chemical products (133)

6.9

19.4

- 4.8

8.2

- 17.2

8.3

- 26.6

9.9

10.1

24.2

of which

Medicines and pharmaceutical

preparations (25)

15.6

5.5

33.7

5.9

9.8

- 6.9

1.3

- 7.7

19.8

4.2

Paints and varnishes (5)

8.3

8.5

16.3

9.7

15.5

15.0

11.2

25.0

- 27.7

- 29.1

Basic industrial chemicals (73)

3.9

25.6

- 12.3

13.0

- 26.2

14.7

- 33.9

14.1

- 1.1

45.9

Chemical fertilizers (18)

4.1

12.9

- 5.2

9.5

- 9.7

7.2

- 20.0

7.4

- 48.6

54.9

Cement (17)

7.4

3.2

- 14.4

- 24.2

- 42.7

- 61.1

- 41.5

- 64.6

- 1.2

8.9

Rubber and rubber products (16)

13.0

- 5.0

3.7

- 62.2

- 1.2

**

- 18.9

* *

13.5

6.1

Paper and paper products (29)

1.5

- 0.4

- 40.3

- 35.8

- 59.9

- 81.6

- 63.9

- 93.0

8.7

- 17.8

Construction (11)

24.9

- 2.6

- 30.9

34.9

14.3

- 45.8

- 5.4

- 44.7

* *

34.8

Electricity generation and supply (7)

12.4

8.0

- 12.0

17.3

- 23.5

5.9

- 32.0

0.5

*

*

Trading (21)

10.3

6.0

- 2.5

-1.0

- 30.4

9.9

- 56.1

73.0

- 24.9

- 28.8

Shipping (7)

20.3

13.6

5.4

2.7

- 10.5

- 4.2

- 19.8

- 5.8

*

*

Diversified companies (9)

10.0

- 28.0

- 10.2

- 55.3

- 35.1

- 70.5

- 37.6

- 71.6

8.5

- 46.5

All Companies (807)

11.1

5.5

- 1.4

- 3.8

- 14.2

- 11.6

- 21.1

- 12.2

11.1

6.3

(Per cent)

Profit margin

Effective tax rate

Debt to equity

Selected Industry / Industry Groups

1996-97

1997-98

1996-97

1997-98

1996-97

1997-98

1

2

3

4

5

6

7

Tea (11)

15.2

20.9

39.9

34.1

22.1

22.3

Sugar (18)

11.3

17.3

92.2

14.7

98.2

95.0

Cotton / blended Textiles (63)

9.0

7.8

31.5

63.1

72.0

78.5

Silk and rayon Textiles (26)

15.4

16.3

5.1

10.0

67.5

42.1

Engineering (265)

12.4

10.3

32.9

33.7

56.6

64.3

of which

Motor vehicles (44)

14.3

12.1

31.1

29.1

38.1

41.9

Electrical machinery (77)

9.5

6.4

43.3

60.2

50.7

44.0

Machinery other than transport & electrical (66)

12.9

11.9

34.3

30.6

28.7

28.9

Foundries and engineering workshop (41)

9.0

7.7

30.6

* *

143.9

204.0

Ferrous/Non-ferrous metal products (31)

11.4

8.4

30.6

77.4

97.9

109.2

Chemical and chemical products (133)

17.0

15.4

25.6

24.5

67.5

65.4

of which

Medicines and pharmaceutical preparations (25)

13.8

13.9

34.7

35.3

16.8

17.9

Paints and varnishes (5)

13.1

13.3

38.9

33.6

37.4

34.0

Basic industrial chemicals (73)

18.5

16.6

19.3

19.7

79.3

76.5

Chemical fertilizers (18)

19.2

18.6

17.8

17.7

86.1

88.3

Cement (17)

16.1

11.8

11.5

19.6

90.2

108.1

Rubber and rubber products (16)

7.7

3.1

36.4

* *

65.0

59.8

Paper and paper products (29)

8.4

5.4

23.1

70.5

59.9

71.4

Construction (11)

7.6

10.5

28.3

26.9

80.3

105.9

Electricity generation and supply (7)

17.1

18.6

27.1

30.8

61.0

69.4

Trading (21)

3.6

3.4

59.1

35.6

23.0

29.6

Shipping (7)

27.8

25.1

19.5

20.9

83.6

88.2

Diversified companies (9)

13.1

8.2

17.1

20.2

60.6

55.9

All Companies (807)

13.8

12.6

26.0

26.6

59.3

60.0

Note :

Figures in brackets denote number of companies.

* *

Denominator nil or negligible.

*

Nil or negligible.

Table 1 : Growth Rates of the Selected Items of the Selected 807 Large Public Limited Companies, 1995-96 to 1997-98

(Per cent)

ITEM

1995-96

1996-97

1997-98

1

2

3

4

1.

Sales $

(25.3)

11.1

5.5

2.

Value of production

(25.8)

9.9

5.5

3.

Total Income

(25.7)

9.8

5.8

4.

Manufacturing expenses

(25.6)

13.0

5.0

5.

Remuneration to employees

(21.6)

12.7

11.5

6.

Depreciation provision

(24.4)

27.6

15.2

7.

Gross profits

(34.5)

- 1.4

- 3.8

8.

Interest

(24.2)

24.1

11.8

9.

Operating profits

(40.1)

- 14.3

- 15.0

10.

Non-operating surplus (+) /deficit (-)

(- 35.9)

- 12.3

42.0

11.

Profits before tax

(32.2)

- 14.2

- 11.6

12.

Tax provision

(46.3)

14.3

- 9.8

13.

Profits after tax

(29.1)

- 21.1

- 12.2

14.

Dividends

(25.4)

2.5

- 3.3

15.

Profits retained

(30.4)

- 29.5

- 16.9

16.

Gross saving

(24.0)

- 9.2

- 0.8

17.

(a)

Gross value added

(24.0)

7.7

4.0

(b)

Net value added

(24.6)

4.5

1.9

18.

Net worth @

(22.7)

12.4

8.2

19.

Total borrowings @

(17.1)

23.2

16.5

Of which, from banks @

(34.3)

17.6

9.7

20.

Trade dues and other current liabilities@

(21.7)

12.3

7.6

21.

(a)

Gross fixed assets @

(20.4)

19.0

16.4

(b)

Net fixed assets @

(22.4)

19.6

16.4

22.

Inventories @

(20.1)

7.1

4.4

23.

(a)

Gross physical assets @

(20.4)

16.7

14.2

(b)

Net physical assets @

(21.8)

16.4

13.6

24.

(a)

Total gross assets @

(19.9)

16.4

11.9

(b)

Total net assets @

(20.6)

16.2

11.1

25.

Total earnings in foreign currencies

(25.6)

20.1

4.7

Of which, Exports

(25.8)

11.1

6.3

26.

Total expenditure in foreign currencies

(39.7)

11.7

0.7

Of which, Imports

(46.1)

11.8

- 0.7

Note :

Figures in brackets relate to 756 companies for the previous study.

Rates of growth of all the items are adjusted for changes due to amalgamation of companies.

$

Net of 'rebates and discounts' and 'excise duty and cess.'

@

Adjusted for revaluation etc.

Table 2 : Selected Financial Ratios of the Selected 807 Large Public Limited Companies, 1995-96 to 1997-98

(Per cent)

ITEM

1995-96

1996-97

1997-98

1

2

3

4

A.

CAPITAL STRUCTURE RATIOS

1.

Net fixed assets to total net assets

45.8

47.2

50.0

2.

Net worth to total net assets

42.9

41.6

41.1

3.

Debt to equity

56.9

59.3

60.0

4.

Debt to equity (adj. for revaluation)

57.3

60.0

61.6

5.

Short term bank borrowings to inventories

63.5

66.3

69.4

6.

Total outside liabilities to net worth

132.9

140.5

143.2

B.

LIQUIDITY RATIOS

7.

Current assets to current liabilities*

1.5

1.3

1.2

8.

Quick assets to current liabilities

59.7

56.3

53.2

9.

Current assets to total net assets

47.5

45.3

41.7

10.

Sundry creditors to current assets

26.5

26.4

28.0

11.

Sundry creditors to net working capital

83.5

102.6

152.7

C.

ASSETS UTILIZATION AND TURNOVER RATIOS

12.

Sales to total net assets

75.0

71.6

67.3

13.

Sales to gross fixed assets

118.0

109.0

96.7

14.

Inventories to sales

21.0

20.2

20.0

15.

Sundry debtors to sales

17.6

18.8

18.2

16.

Exports to sales

8.5

8.5

8.6

17.

Gross value added to gross fixed assets

30.5

27.3

23.9

18.

Raw materials consumed to value of production

48.3

49.3

48.2

D.

SOURCES AND USES OF FUNDS RATIOS @

19.

Gross fixed assets formation to total uses of funds

(53.8)

62.5

76.3

20.

Gross capital formation to total uses of funds

(67.1)

68.3

80.9

21.

External sources of funds to total sources of funds

(57.7)

65.1

62.8

22.

Increase in bank borrowings to total external sources

(26.2)

16.7

13.1

23.

Gross saving to gross capital formation

(60.6)

52.0

51.3

E.

PROFITABILITY RATIOS

24.

Gross profits to total net assets

11.7

9.9

8.5

25.

Gross profits to sales

15.6

13.8

12.6

26.

Profits after tax to net worth

15.4

10.8

8.5

27.

Tax provision to profits before tax

19.5

26.0

26.6

28.

Profits retained to profits after tax

73.7

65.9

62.4

29.

Dividends to net worth

4.1

3.7

3.2

30.

Dividends to ordinary paid-up capital

26.4

24.5

22.0

Note:

Figures in brackets relate to 756 companies for the previous study.

@

Adjusted for revaluation, etc.

*

Item B.7 is the actual ratio of current assets to current liabilities.

Table 3 : Combined Income, Value of Production, Expenditure and Appropriation Accounts of the Selected 807 Large Public Limited Companies, 1995-96 to 1997-98

(Rs. crore)

ITEM

1995-96

1996-97

1997-98

1

2

3

4

INCOME AND VALUE OF PRODUCTION

1.

Sales $

1,49,420

1,66,037

1,75,200

2.

Increase(+) or decrease(-) in stock

3,103

1,583

1,575

3.

Value of production (1+2)

1,52,524

1,67,620

1,76,774

4.

Other income

5,238

5,829

6,447

Of which,

(a)

Dividends

1,032

821

759

(b)

Interest

2,086

2,296

2,421

(c)

Rent

221

358

414

5.

Non-operating surplus(+)/deficit(- )

955

837

1,188

6.

TOTAL (3 + 4 + 5)

1,58,716

1,74,286

1,84,409

EXPENDITURE AND APPROPRIATIONS

7.

Raw material, components, etc., consumed

73,701

82,620

85,263

8.

Stores and spares consumed

7,338

7,882

8,382

9.

Power and fuel

10,807

12,975

15,324

10.

Other manufacturing expenses

1,944

2,488

2,250

11.

Salaries,wages and bonus

9,660

10,844

11,976

12.

Provident fund

939

1,058

1,285

13.

Employees' welfare expenses

1,587

1,829

2,045

14.

Managerial remuneration

147

167

226

15.

Royalty

295

352

391

16.

Repairs to buildings

490

526

560

17.

Repairs to machinery

1,988

2,305

2,413

18.

Bad debts

256

352

403

19.

Selling commission

1,060

1,175

1,161

20.

Rent

1,150

1,386

1,527

21.

Rates and taxes

664

784

753

22.

Advertisement

1,235

1,423

1,704

23.

Insurance

653

734

820

24.

Research and development

372

445

487

25.

Other expenses

14,698

14,224

16,132

26.

Depreciation provision

5,348

6,826

7,864

27.

Other provisions(other than tax & depreciation)

143

90

153

28.

Gross profits

23,284

22,964

22,102

29.

Interest

7,831

9,719

10,861

30.

Operating profits

15,453

13,245

11,261

31.

Non-operating surplus(+)/deficit(-)

955

837

1,188

32.

Profits before tax

16,408

14,082

12,449

33.

Tax provision

3,206

3,666

3,307

34.

Profits after tax

13,201

10,415

9,141

35.

Dividends

3,467

3,554

3,436

(a)    Ordinary

3,442

3,505

3,388

(b)    Preference

26

50

48

36.

Profits retained

9,734

6,861

5,705

37.

TOTAL (7 TO 28 + 31)

1,58,716

1,74,285

1,84,409

$

Net of 'rebates and discounts' and 'excise duty and cess'.

Table 4 : Combined Balance Sheet of the Selected 807 Large Public Limited Companies, 1995-96 to 1997-98

(Rs. crore)

ITEM

1995-96

1996-97

1997-98

1

2

3

4

CAPITAL AND LIABILITIES

A.

Share capital

13,728

14,863

16,439

(6.9)

(6.4)

(6.3)

1.

Paid-up capital

13,726

14,861

16,437

(a)

Ordinary

13,055

14,281

15,401

Of which, bonus

3,209

3,503

4,187

(b)

Preference

671

580

1,036

2.

Forfeited shares

1

2

2

B.

Reserves and surplus

71,852

81,527

90,593

(36.0)

(35.2)

(34.8)

3.

Capital reserve

35,495

39,404

43,516

Of which, premium on shares

27,570

30,056

31,101

4.

Investment allowance reserve

1,280

1,262

1,115

5.

Sinking funds

4,220

5,039

5,812

6.

Other reserve

30,858

35,823

40,150

C.

Borrowings

71,816

88,488

1,03,124

(36.0)

(38.2)

(39.6)

7.

Debentures @

13,983

15,598

19,519

8.

Loans and advances

54,102

68,358

78,557

(a)

From banks

23,782

27,980

30,681

Of which, short term borrowings

19,901

22,256

24,325

(b)

From other Indian Financial Institutions

18,220

21,584

24,087

(c)

From Foreign Institutional agencies

4,052

4,394

3,106

(d)

From Government and semi-Government bodies

2,466

2,671

3,504

(e)

From companies

1,324

2,614

3,906

(f)

From others

4,258

9,115

13,273

9.

Deferred payments

667

794

723

10.

Public deposits

3,064

3,737

4,324

(Of total borrowings, debt)

48,685

57,122

64,237

D.

Trade dues and other current liabilities

37,728

42,381

45,608

(18.9)

(18.3)

(17.5)

11.

Sundry creditors

25,083

27,686

30,343

12.

Acceptances

2,486

3,614

2,224

13.

Liabilities to companies

93

175

227

14.

Advances/deposits from customers, agents, etc.

5,043

5,191

5,809

15.

Interest accrued on loans

1,697

2,066

2,786

16.

Others

3,326

3,648

4,219

E.

Provisions

4,230

4,578

4,562

(2.1)

(2.0)

(1.8)

17.

Taxation(net of advance of income tax)

-

-

-

18.

Dividends

3,214

3,295

3,066

19.

Other current provisions

591

986

1,107

20.

Non-current provisions

424

297

389

F.

21.

Miscellaneous Non-current liabilities

-

-

-

22.

TOTAL

1,99,354

2,31,837

2,60,326

(100.0)

(100.0)

(100.0)

ASSETS

G.

Gross fixed assets

1,26,678

1,52,299

1,81,099

23.

Land

2,811

3,526

4,275

24.

Buildings

11,613

13,889

16,576

25.

Plant and machinery

88,169

1,06,484

1,26,996

26.

Capital work-in-progress

17,060

20,102

23,295

27.

Furniture, fixtures and office equipments

2,223

2,700

3,198

28.

Others

4,801

5,598

6,759

H.

29.

Depreciation

35,441

42,966

51,055

I.

30.

Net fixed assets

91,237

1,09,333

1,30,044

(45.8)

(47.2)

(50.0)

J.

Inventories

31,350

33,561

35,045

(15.7)

(14.5)

(13.5)

31.

Raw materials, components, etc.

10,070

9,947

9,494

32.

Finished goods

10,332

11,342

12,579

33.

Work-in-progress

5,048

5,615

5,958

34.

Stores and spares

4,796

5,586

5,776

35.

Others

1,104

1,071

1,239

K.

Loans and advances and other debtor balances

50,811

58,571

58,181

(25.5)

(25.3)

(22.3)

36.

Sundry debtors

26,275

31,190

31,967

37.

Loans and advances

17,444

19,984

19,206

a)

To subsi. and cos. under same management

1,730

1,361

1,374

b)

Others

15,715

18,623

17,831

38.

Interest accrued on loans and advances

179

187

359

39.

Deposits/balances with government/others

4,460

5,369

5,225

40.

Others

2,453

1,841

1,423

L.

Investments

16,997

20,333

23,236

(8.5)

(8.8)

(8.9)

(Of which, quoted investments)

5,291

5,574

4,097

41.

Foreign

158

3,106

3,222

42.

Indian

16,839

17,227

20,014

a)

Government/semi government securities

306

513

168

b)

Securities of Financial Institutions

4,565

3,153

3,457

c)

Industrial securities

8,959

9,789

11,123

d)

Shares and debentures of subsidiaries

2,750

3,624

4,266

e)

Others

259

148

1,000

M.

43.

Advance of income-tax(net of tax provision)

171

123

159

N.

Other assets

1,778

2,721

2,599

(0.9)

(1.2)

(1.0)

44.

Immovable property

39

32

39

45.

Intangible assets

1,731

2,583

2,466

46.

Miscellaneous Non-current assets

9

106

94

O.

Cash and bank balances

7,010

7,194

11,062

(3.5)

(3.1)

(4.2)

47.

Fixed deposits with banks

3,093

2,961

3,740

48.

Other bank balances

2,981

3,315

6,068

49.

Cash in hand

936

918

1,255

50.

TOTAL

1,99,354

2,31,837

2,60,326

(100.0)

(100.0)

(100.0)

Note:

Figures in brackets denote the share in total liabilities/assets.

@

Include privately placed debentures.

-

Nil or negligible.

Table 5 : Sources and Uses of Funds of Selected Large Public Limited Companies, 1996-97 and 1997-98

(Rs. crore)

ITEM

1996-97

1997-98

1

2

3

SOURCES OF FUNDS

INTERNAL SOURCES

13,457

12,174

(34.9)

(37.2)

A.

1.

Paid-up capital

293

684

(0.6)

(2.1)

B.

Reserves and Surplus

6,582

4,522

(17.1)

(13.8)

2.

Capital reserve

- 144

- 382

3.

Investment allowance reserve

- 18

- 147

4.

Sinking funds

819

774

5.

Other reserve

5,924

4,277

C.

Provisions

6,582

6,968

(17.1)

(21.3)

6.

Depreciation

6,187

7,020

7.

Taxation (net of advance of income tax)

47

- 35

8.

Dividends

80

- 229

9.

Other current provisions

394

121

10.

Non-current provisions

- 127

92

EXTERNAL SOURCES

25,080

20,550

(65.1)

(62.8)

D.

Paid- up capital

3,697

2,628

(9.6)

(8.0)

11.

Net issues

894

940

12.

Premium on shares

2,803

1,688

E.

13.

Capital receipts

61

91

(0.2)

(0.3)

F.

Borrowings

16,669

14,603

(43.3)

(44.6)

14.

Debentures

1,615

3,920

15.

Loans and advances

14,253

10,167

(a)

From banks

4,197

2,701

(b)

From other Indian Financial Institutions

3,361

2,471

(c)

From Foreign Institutional agencies

342

- 1,288

(d)

From government and semi- government bodies

204

833

(e)

From companies

1,291

1,292

(f)

From others

4,857

4,158

16.

Deferred payments